When the Local Used Bookstore Prices Economics Books at $15

question 165

Multiple Choice

When the local used bookstore prices economics books at $15.00 each,they generally sell 70 books per month.If they lower the price to $7.00,sales increase to 90 books per month.Given this information,we know that the price elasticity of demand for economics books is about

• A)2.91, and an increase in price from $7.00 to $15.00 results in an increase in total revenue.
• B)2.91, and an increase in price from $7.00 to $15.00 results in a decrease in total revenue.
• C)0.34, and an increase in price from $7.00 to $15.00 results in an increase in total revenue.
• D)0.34, and an increase in price from $7.00 to $15.00 results in a decrease in total revenue.

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Definitions:

Picketing

A form of protest by workers outside a place of employment or another significant location to express grievances or demand rights, often during strikes or labor disputes.

Boycott

A form of protest in which individuals or groups refrain from using, buying, or dealing with products or services of a company as an act of criticism or demand for change.

Mackay Doctrine

A principle from U.S. labor law allowing employers to permanently replace striking workers under certain conditions, established in the case NLRB v. Mackay Radio & Telegraph Co.

Perfect Information

A scenario in economics where all parties have access to all relevant information about a transaction, market, or event before it occurs.